At January 1, 2025, Clinton Imports Inc. reported this information on its balance sheet.
Accounts receivable
$552,000
Less: Allowance for expected credit losses
35,200
During 2025, the company had the following summary transactions related to receivables and sales. Clinton uses the perpetual
inventory system. Clinton expects a return rate of 3%.
1. Sales on account amounted to $2,200,000. The cost of the inventory sold was $1,980,000.
2. Goods with a total sales price of $35,200 and a cost of $31,680 were restored to inventory.
3. Collections of accounts receivable were $1,936,000.
4. Write-offs of accounts receivable deemed uncollectible, $39,600.
5. Recovery of credit losses previously written off as uncollectible, $13,200.